Haines, a wholesaler that sells to nearly 10,000 independent specialty flooring stores in the Mid-Atlantic and southeastern United States, finalized the acquisition Jan. 17 for an amount it declined to disclose. The combined company will have annual sales of more than $500 million, more than 750 employees and 38 locations.

"They were the No. 1 distributor and took on No. 3, so they are the largest by far," said Michael Blick, president of trade publication Floor Covering News.

The acquisition, Haines' largest ever, will allow the more than century-old business to become a multidivision distributor, expand its floor-covering supplies business and create a division dedicated exclusively to selling Armstrong products, said Haines President and CEO Bruce A. Zwicker.

CMH, based in Wadesboro, N.C., adds $190 million worth of sales in Haines' geographic territory, mostly flooring brands that Haines was not selling, as well as a much larger supplies business, Zwicker said.

Besides lowering costs, the merger will help Haines quickly boost market share in the slow-growth floor coverings category, which typically expands at the rate of the economy and can follow the ups and downs of home sales, Zwicker said.

"It's a very competitive business, very competitive on margins," Zwicker said. "There is consolidation going on in the flooring industry at all levels, manufacturers, distributors and the retail sector."

Consolidation among distributors has begun to level off, Blick said. About 75 floor covering distributors remain out of about 400 at one time, with hard-surface products such as laminate and ceramic driving the growth, he said.

Haines was founded by John James Haines in 1874 as a general store in Upperville, Va. The business expanded into selling hardware and building products before specializing in flooring some 80 years ago, Zwicker said. The distributor had a headquarters and warehouse on Monument Street in Baltimore until 1989, when it moved to Glen Burnie, where its main warehouse is located and it employs a little more than 200 people. It also operates nine other warehouses, including three added in the CMH deal.

Haines sold mainly to retailers in the Mid-Atlantic until 2007 when it acquired a Florida flooring distributor and began expanding into the Southeast, Zwicker said. Much of the company's growth has come through 13 acquisitions over its history, he said.

"We've always been financially secure and stable," said Zwicker, who said members of the founding family remain among the company's 80 shareholders and provided the leadership through 2004. "We reinvest in the business. The shareholders are committed to the long-term growth of the company."

The company is now the largest distributor of Armstong products, a brand Haines has been selling for a century. Armstrong World Industries, based in Lancaster, Pa., is a top producer of flooring products.

Zwicker said a newer technology luxury vinyl tile is one of the company's top selling products.

"Luxury vinyl tile can look like ceramic tile, and it can look like wood," he said.

Since becoming CEO in 2005, Zwicker said, he's met the owners of nearly every floor covering distributor on the East Coast. One of his first visits was to CMH.

"We formed a good relationship and have been talking about putting the two companies together," he said. "The owners weren't ready until now."